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tv   Fast Money Halftime Report  CNBC  November 5, 2012 12:00pm-1:00pm EST

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thanks for that. >> thank you very much. >> that does it for us. let's get back to headquarters. michelle and the "fast money" halftime. >> thank you, carlito. welcome to the halftime report. i'm michelle caruso-cabrera. 13,079 on the dow. the s&p a decline of a point and the nasdaq composite in positive territory by six points just below 3,000, apple helping out there. on halftime, the election, of course. what an obama or romney victory means for the market and your investments. sandy's aftermath. we continue to track the latest kwomts as the east coast tries to pick up the pieces after the superstorm. we are trading the big movers with stephanie link, joe teranova and downtown josh brown. let's get to the election. the two candidates are entering the home stretch.
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john harwood has the latest from both camps. >> the candidates are racing through the battleground states. the organizations are working to turn out voters. the president will be appearing with bruce springsteen in ohio. jay-z in wisconsin rather. mitt romney is going to new hampshire. twice to virginia. you look at the polls and they are extremely tight. our last nbc news/wall street journal poll shows 48% for obama. 47% for mitt romney. that's as tight as you can be. well within the margin of error. either candidate can win the popular vote. you look at the battleground states and that's where president obama held an advantage. look at final three polls for nbc and the wall street journal. first of all in virginia. key battleground, 13 electoral votes at stake. 48, 47 bavmt look at florida. even bigger. of course the election that deadlocked the 2000 campaign. 49-47 obama.
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and the state of ohio which most see as the hinge state for the election. 18 electoral votes. president obama up 51-45 among likely voters. we don't know the composition of turnout. white versus african-american and hispanic turnout. these key. and the proportion of senior citizens versus young voters. obama's base but they have not shown a tremendous amount of interest. >> pennsylvania had become a swing state. do you believe it? >> i don't believe so. mitt romney doesn't have as many options as president obama does. he's making a late play to move the numbers. >> are we going to have an answer on wednesday or is this going to drag out? >> i think we'll have an answer. i have been saying by midnight. some of my colleagues say it may take longer to call some states.
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i think if you look at the consistency of the way battleground states tend to fall it is not likely we'll in b in a multi day process. >> you have a question for john? >> i do. january of 1970 and january of 1987 the markets in anticipation of a change to capital gains and dividend, we saw selling in the fall months prior. this time we are seeing it again. what's the grand compromise going to be? you have 3.8% attached to the aca. along those lines capital gains go up to 20. do dividends go as high as ordinary income or can we ark strait more of a compromise in the 20s? >> i don't believe dividends will go to ordinary income. that was a place holder in the president's budget. i would expect a compromise to end up with dividends and capital gains at 20 with the top rate going up. maybe not up to 39-6. you could see play there and tax
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reform is one of the variables. if there was a way to leave tax rates relatively stable but do something with deductions in a way to satisfy the president's desire to get it out of top earners you could see those things happen. >> thank you, john. good to see you. all right, historically when you look at the numbers a democratic president has been better for stock. with the average dow return being 74% out of democrats beating a 6% gain from republicans, remember one thing. the republican number is depressed by hoover, a decline of 80% plus. monetary policy was different back then. it would never happen today. this is a number that maybe isn't worth reporting. always interesting to look at. what about sectors that could benefit? we created indices of stocks to gain under obama or romney. in president obama's basket we have home building, auto stocks. a lot of solar powered company.
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in romney's portfolio, coal, oil, gas, utilities and managed care. what's the trade here the day before the election? >> just having some sort of certainty once we get results the markets will have are a relief rally or investors should be relieved. >> just knowing the answer? >> sure. it's so close. >> that would be by today. >> i think you can. i think you have to come back to. we know the sectors that will work under romney and that will work under obama. you have to focus on fundamentals and you can buy banks under either scenario. fundamentals in the banks and financials have improved. they will benefit if romney wins because because of less regulation. energy has done well and i think you can continue to own the energy stocks. i think you have to come back to fundamentals. we just got earnings. so we got a lot of information we could digest to figure out where to go. >> i think first of all, i agree with stephanie. we are going to have a relief
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rally. remove uncertainty and we'll turn to if fiscal cliff. i don't think there is going to be a fiscal cliff. there will be a settlement to push it out. the strength of the settlement and what it does for the market is a different thing. with romney it's longer lasting. he'll get a compromise. for me the best sector to play are the banks. if romney comes in you will see a new head of the fed for bernanke. that means interest rates are going up. they are going up anyway because the economy is improving. that means greater margins for the banks and as stephanie pointed out there is regulation. >> if money gets tougher it will be better for is it stock market? i don't believe that. >> no. you you're won't see a big enough increase in rates for it to get tougher? >> even if romney wants to bring in somebody tougher than bernanke? >> money has been easy for a long time.
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that's not what hurt companies from borrowing. banks don't believe in the prospects. if the business environment improves which i believe it will under romney then the banks will ease up and focus on the prospects. >> josh, do you disagree? there are people who say romney is better for business confidence. so the market will go up. romney would be put in somebody who's tougher at the fed so stocks go down. what do you think, josh? >> you know, it's an interesting question. i think the knee jerk reaction to a romney victory which, by the way, the market is telling you probably won't happen. >> right. >> i just look at this in terms of volatility. you showed the romney and obama portfolios side by side, the indexes you created. they are moving in the same direction. that doesn't give us a ton of information. typically low volatility which is what we have headed into an election all goes well for the incumbent. we have seen the research that bears it out.
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the way to think about it for people is there is no necessity to bet on either a romney or obama victory. >> josh, this is fast money. joe, what do you think? >> we have one left. >> that's it. four hours to trade. go. >> we have to look at it similar pl simplistically. you have to see at some point a reallocation out of fixed income. i think there is grand compromise that everyone's talking about surrounding the fiscal cliff. around christmas we have to have real serious negotiation. on the other side if governor
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romney wins you look at a name like trans-canada tied to the keystone pipeline. maybe you own it on the belief he does. >> >> i hear chatter about dividend stocks getting killed if obama wins. i really disagree with that. dividend stocks have a bond-like characteristic and a lot of investors. number two, keep in mind most of the stuff is held in accounts that are either tax performanced because they are retirement accounts or institution t. >> if romney wins what does the market do. if obama wins what does the market do. the next guest thinks you should stay away from all u.s. stocks regardless. rob arnott runs research affiliates and is from pimco all asset funds.
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>> why do you think either one is negative for stocks? >> first, there are differences between a romney victory and an obama victory. but there are comal tis. whoever wins faces a daunting four years and inherits a bitter chalice. we have an addiction to debt financed consumption. obama clearly will want to continue to pursue the policy. romney may want to reverse it but may find it is politically impossible to do so. eventually you hit a greek-style wall. now that's a danger affecting both potential presidential victors. now the implication of that is how do we invest? >> that's the next question. >> most investors have the lion's share of their money tied up in main stream u.s. stocks
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and bonds, comparatively little invested in a third pillar. if the first pillar is stocks, participating macro economic growth. if kbrout is slow, which it will be then that pillar is week. if bond yields are negligible which they are that pillar is week. if inflation kicks in in the coming four years both pillars crumble. investment in a third pillar, diversifying away from main stream stocks and bonds into emerging markets, stocks and bopds. >> we saw a graphic that shows the components of the third pillar. you are basically saying diversify away from the united states. emerging market equities, debt. are you talk about sovereign, corporates or both? >> it's a stealth inflation hedge. if inflation kicks in the real value of the debt tumbles. you can wind up with a falling spread creating capital capital
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gains. real estate, when it becomes cheap again in the next recession and commodities. these represent powerful diversion diversity if i indications that will serve investors well no matter who wins tomorrow. >> do you have a favorite part of the emerging markets in terms of stocks and would you be looking at etfs, individual stocks or u.s. companies with exposure to emerging market countries? >> a broad diversion if i indication makes sense. it shouldn't be weighted by fwond size of the debt. you don't want to put most of your money in emerging market economies. but a broadly diversified basket rather than cherry picking regions and countries gives you tremendous diversification. people talk about the brics --
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brazil, russia, india and china. any of those are different from any around the world. japan and germany have more in common than whereas brazil and russia. a broadly coerce identified e mernling markets portfolio belongs in the tool kit of the investors. >> josh, do you have a question? >> rob, i'm a fan of your work. >> thank you. >> my question would be you're talk about being net short u.s. equities. i know your benchmark as opposed to other money managers is not a traditional stock or bond measurement but inflation plus points to the upside. you are concerned with purchasing power. >> you bet. >> if that's the case are you looking for deflationary environment going forward? >> no. actually not. we are looking at an inflationary environment. >> how far into the future?
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>> the net short is largely a way of hedging out the equity market sensitivity of other investments. you can take some of the stock market risk out. >> can you clarify if the u.s. market is going up or down? >> short term it's fine. this is a safe haven. there will be flights to safety. long term, the dollar is toast. >> all right. bob, good do see you. we appreciate it. >> thanks. >> coming up, buying kpw. we have a first on cnbc interview with the ceos coming up. and hundreds of thousands in the karkh a week after sandy hammers the east coast. the latest on the blackouts and what it takes to beef up the power grid. halftime returns after this.
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some big news today. stifel financial buyi ing kbw ia 7% premium in a cash and stock deal. let's welcome president and ceo of kbw and the chairman, president and ceo of stifel financial. good to have you here. >> good afternoon. >> good to see you here. clearly you are building something big, ron. you bought a lot of stuff. thomas wizel, miller buckfire, talked about buying them, you looked at glecher and now this deal. how does kbw fit in? >> it is the premier financial services specialist. internationally, globally, you name it. it makes us a better firm. our product suite will make them better for what they do.
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it's a great combination. >> they fit into the plan how? where are you going? >> our goal is to build a premier middle market investment bank in the country. clearly they are a piece of the puzzle. >> so what's left to fill in that you need to get in order to fill out the cream of yours? >> there is plenty that we can do. there is plenty of market share we can gain. wir not done. >> but you don't want to drop hints? >> you know i always disclose my merger plans on cnbc. >> why is it good to sell at this point? why is it better for your shareholders instead of building business on your own? >> well, we believe that stifel has a great set of products and skills that can really help us to essentially super size our effort. we are very, very interested in the financial private wealth area of the company as well as the fixed income area where we
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think we can leverage a lot of those skills to do more with our clients. >> i'm looking at the results you posted. investment banking revenue down sharply compared to a year ago. commission revenues as well. clearly ron thinks these are not secular issues but cyclical and your company is eventually going to see improvement on this. how long before we get out of the trough that your business and many others are seeing? >> it's a lot like the economy. the economy has been slow growth. what's really surprised me -- i have been in the business for 26 years, is how sharply the trading volumes have fallen off. also, investors have been spooked out of equities. i was watching the clip you had earlier with guests. if investors come back to equities, it can turn around quickly. >> tell me about the decision to exit asia. everybody talks about chinese growth, asian growth. we had a guest on saying
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investors have a pillar of u.s. stocks and bonds but they should be looking at emerging markets. yet you are pulling out of asia. why? >> mainly because business was centered on the cash equities business in asia which was no different from the rest of the world. trading volumes have been down. share prices have been down. you get paid as a value of the trade in asia which is different from the united states where you are paid as a price per share. so we felt that the business was not likely to turn for the near-term horizon. >> ron, i will try one more time. you said openly in the past you would like to buy miller buckfire. can buckfire, a frequent guest here, do you still want to buy them? >> ken is a great partner. we're partnering great. >> i'll check in with him. >> want to broker the deal? >> can i get a commission? that's great.
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>> you didn't mention my earnings. we're up 60%. what's the deal? >> why? >> all of our past investments are bearing fruit. that's why. we're going to have fun. >> how long do you think it can continue. >> who's going to be the winner, do you think? fl. >> i need regulatory approval. i will keep it. >> see you later. thanks for joining us first on cnbc. >> both of the stocks are doing well. >> they are wearing the same outfit. they had matching jackets and ties. this will be the winner of a deal. on the same pang already. >> they specialize in banks.
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the sell side brokerage model is one of the worst business models i have seen. commissions are as low as they can go. there are no volumes. they have no bargaining because there is capacity in terms of the clients. maybe you can do well owning goldman, morgan and stifel but a lot of businesses will not be acquir acquired. the mid tier banks have lost in terms of getting into deals. i'm talking about m & a, ipos and secondaries. i would be cautious. if there was a company to be bought it's kbw. a year ago they were in the mid 20s. they are selling here so it's a hail mary. >> the sell side business, institutional business is challenged. stifel is doing well at picking up companies on the cheap. it's a good price. i agree with steve.
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i don't think this is where you want to be. there are other fms to own with more upside. >> america's most valuable company on the move. jackie is tracking it. >> good afternoon. apple shares are definitely on the move up 1% at this point. this after selling 3 million ipads since the launch of the mini and the 4th gen, twice what we saw in the first weekend when the ipad 3 went on sale in march. both of these, the wifi and cellular versions of the mini and fourth gen will be shipping in a few weeks. apple up more than five bucks today. >> joe, what do you think? >> apple is going through the same thing it went through this time last year. there is an end of year sell-off accelerated by the fact that apple is up over 600% since the beginning of 2009. we have anticipation of a change in the capital gains tax rate. it all comes down to january.
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you potentially line up for a repeat performance of what you had. this past january stock goes to 450. fundamental story. it's as robust as ever. >> buy? >> wait until you hear what the story is in january. that's the time you get in. the stock every looked back in january off the earnings move from 420 to 450. i'm waiting for that. >> anybody expecting a change because of the ipad mini? >> i saw a call out of barclays. just the fact that they are putting out the press release in terms of the initial guidance being too conservative on this particular product and then on earnings in general. they reiterated an $800 target which is comforting news to those who have ridden the stock down more than a hundred points. it's not just an analyst defending it, but with a reason this time. >> forget about what the broker said. look at apple's annual filing.
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since they are a september company just came out. cap-ex is going down but it's more than double the 4.7 billion it was. that means there are more new products. that's where growth will be but it will be dead money through the end of the year. >> all right, guys. thank you very much. on the way a management shake up at morgan stanley as it seeks to boost profits and the investment bank. sandy does a number on the power dprid on the east coast. many without electricity. when we got married.
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banking giant morgan stanley is revamping its institutional security business. mary thompson has more on the story. >> come january mor dan stanley will have a single president of institutional securities ending a stint of two men sharing the job. colm kelleher takes over the investment bank as well, a role held by paul tubman. a 30-year veteran of the firm
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described as a brilliant banker. it's been decided the bank's former cfo is better to handle the task of boosting return on equity. whether it be through cost cuts or figuring out how best to deploy billions of deposits from the british columbia raj business. the announcement delayed because of the storm and discussed after last quarter earnings. it's not a complete surprise to many. keller and taubman didn't get along but the bank asked him to stay. morgan stanley faced a wealth of challenges in the wake of the financial crisis. most recently concerns about the disastrous facebook ipo. it's been revamping the business model in a tough business and regulatory environment. james gorman aiming to grow share in the fixed income business as it sheds risky assets. the inconsistent performance of the business described by one analyst as being in the fourth
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year of a two-year over haul is a concern for investors and a challenge for kelleher himself a former fixed income sails person. >> let's trade this, guys. what do you do with morgan stanley? >> not much. i prefer goldman sachs. they are remaking one of the oldest institutions and changing the personality. there is a lot of change there. a lot of moving parts. fortunately for them it's like a two or three-horse race with jpmorgan and kblax tgoldman sac winners. >> it's a distant third to jpmorgan and goldman. i struggle with the company. they don't know if they want to be a retail house, institutional house. we haven't seen that. >> it changes year to year. >> i think kelleher is excellent. he nav dpated through the financial crisis well. he's capable. but i think the structure of the company and the strategy is
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challenged. i just want to see synergies from smith bar any acquisitioac >> hurricane sandy crippled the northeast leaving millions in the dark. utility crews worked around the clock to restore electricity. what did sandy teach us about the power grid? let's welcome the managing director of clear view partners. good to have you on. >> thank you for having me. >> can i ask, a lot of people in the this area think it is absurd they have to live for two weeks, maybe more without power in the wake of a category one storm. they think there is something broken about the utility system because this happens year after year. are they right? >> it depends what your metric
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is. if you measure it as a category one storm certainly you will be frustrated. if you look at the fact that we had a storm surnl which was the greatest thing the new york city area has seen probably in its modern history, the fact that we have been able to get so many customers back online, i think, is a credit to the utilities. their historical performance in doing well, keeping the lights on through what a lot of people don't appreciate as disruptive is something they are reckoning with now. if you are someone out of power of course it seems absurd. >> especially in inland new jersey where there was no flooding. it's about wind damage. some people live in towns with no damage and they don't understand why they have to live without power. >> when am i going to get power back? >> i agree. >> three people on this -- joe, you don't have power? >> not for a long time. >> do i look like i have power? >> three people here are without power. >> eight days. >> thanks for coming on, christine. >> another premise out there is that part of the underlying problem is the business model of the utilities which are regulated to death.
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regulators say what they can charge, what the investment plans can be. why have a ceo when the bureaucrats make the decisions? is that the wrong way to think of it? >> it's part of the channllenge when you have a business model where customers don't want to pay for the service. people don't want to pay more if they are looking for it. the charge of delivering electricity against protecting against an event like this. nobody wants -- feels good about paying for expensive insurance if it is never required. now we are seeing if we do not invest in the grid and part of the reason you're in central new jersey is if we have a grid problem that goes back to part of the system located in coastal new jersey, that's why you are out. >> josh? >> it's all interconnected and not just the regulators but the regular kbla tors are responding to the fact that customers want rates low. >> do you think there is going to be any kind of a push to move
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more power lines under ground or make huge changes to the way substations are connected, transmission lines or are they going to fix what was already there and roll the dice on the next one? what do you think will be the impact on this over the next six months to 18 months, let's say in terms of capex? >> we'll have a lot of conversation about under dnd dst grounding but the price is still high. if you ask anybody living in connecticut how much more it costs them to under ground only sections of the big norwalk line you can sigh it's more expensive. it was a benefit because a lot of the stuff under ground would come online in con-edison service territory but it was shut down. if you can shut it down before it is danieled, drain it, dry it and get it back up. if it is hanging in trees that have come down, think about it. there are only so many physical trucks you can have on the road at one time. >> clearly these companies will incur costs. they haven't been able to charge for the power.
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it may be prorated utility bills. they have had massive overtime. it happened last year in this same part of the country. after the last hurricane snowstorm, what does it do the stocks? is it a buying opportunity or does it hurt them for a period going forward? >> it depends on how long you want to hold them. some of the costs will be picked up by insurance. some may or may not get recovered in rates going forward. one of the things that you can see also is moody's put several of the impacted utilities on credit watch. they are concerned about a negative regulatory response. the pressure and frustration of customers out of power. so i think what you see is in the medium term, you know, these adversely impacted utilities may not be the strongest performers in the next 12 the months. >> christine, thank you very much for joining us. >> thanks for having me. >> let's trade the worst
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three-day period for the utilities in a year. what we called the interest rate sensitive utilities. anybody buying, selling? >> i hate this sector. nothing to do with the storm. it is relative to the s&p in terms of the multiple people are paying for the stocks because of the yields. it's absurd. last i looked it was a 25, 28% premium to what they should trade at historically. forget the storm. i don't like the group in terms of potential for gains from these levels. >> that's the problem with josh. you never know what he's thinking. still to come, how austerity could affect the euro and more. first the scramble to get gas back in the northeast. kate kelly has the latest. >> reporter: steady traffic today, michelle at a gas station that serves gas stations. could be good news for area drivers. more when we come back.
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fuel shortages and gas lines remain a problem in the northeast. a week after sandy slammed the coast. kate kelly joins us from linden,
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new jersey with a gas station for gas stations. i love it. >> reporter: michelle, things are getting moving today at the nustar energy gas terminal here. we have seen a slow, steady string of trucks coming in and out today after a quiet couple of days since getting the facility up and going on saturday. at one point there were three trucks filling up at the same time. it's a far cry from last week when this facility was operating with nothing but limited generator power and its facilities were badly damaged. within the last two, three days nustar and others have been able to restore operations to the all-important storage and distribution networks that dot this part of jersey. since they are effectively, as you said, the gas stations that supply gas stations, this is real progress in getting the region back on its feet from the storm. but with marine terminals here and nearby out of commission the terminals are having to get creative. nustar never fuelled a jet truck
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here for example, but this morning it filled one for southwest airlines. tonight it's hoping to load up a gas barge as part of the marine terminal on the water which would be the first such event since the storm. but getting the entire operation back to normal will be another four to five weeks, officials say. meanwhile the price of gas is plummeting around the country. it's the biggest two-week spike since the wild days of 2008. at this point, michelle, the average gas price is about $3.47 which is almost a 10% drop since a month ago according to aaa. >> i hear the germ of a lot of good news there, kate. thank you very much. we're looking forward to better news in the days ahead. refineries bracing for another storm in the east. maybe it won't be good news. our next gaes guest said officials should have imposed gas rationing as soon as sandy impacted gas supplies. did officials do enough? let's welcome the founder of citizens for affordable energy, former president of shell oil.
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good to have you on again. i was listening to you on squawk box saying the first thing they have to go to is odd-even plates in new jersey. it was like chris christie was listening. within 24 hours, maybe within 12 it's what they did. what should be done right now especially as we watch this storm approach again? >> the more you can harden your assets whether it's refineries, marine terminals, pipelines, ports, hardening assets has been learned on the gulf coast. >> what does that mean? >> hardening your assets means, for example, getting the electrical system components off the ground, off the flat surface of the refinery, put them up 10, 12 feet to avoid flooding. yes, harder maintenance but you don't have to worry about flooding. knocking out whether it's trans formers, motors, whatever that
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are electrically driven. also putting in windshields. they will try to block the wind to prevent wind damage in vulnerable spots of the refinery. this is something they have been doing for years in the gulf coast rather than having to rebuild after every storm. whether refineries do that or not is up to them. just the whole concept of hardening and getting advice on what could be done to make things stronger for the future, that's the supply side. on the demand side what governor chris christie did is what should have been done. if you have outages and you have a huge electrical breakdown your gas stations are like homeowners. they don't have power to do anything. you can't just bring in a generator and start pumping gas. you have to wire the gas station for a generator so you can work
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the cash register and other components. you can do that in advance. >> you brought up chris christie and the odd-even days, et cetera. i was shocked new york seemed to take the opposite tact. governor cuomo said there would be free gas supplied by the army. he increased demand basically at a moment when you should try to depress demand. within hours they had to shut it down because they were inundated and decided they needed that for emergency vehicles. was that a bad idea? >> it e means he doesn't understand supply and demand. when you have a supply problem you need to offset it with a demand contraction. that works all the time if you can do both sides of the equation. if you think you can call the military and come out and supply people with free gas lean, why not bread and circus at the same time? it's just giving away for whatever political points, but i think it actually comes back to hurt.
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then governor chris christie took a balanced attach. governor cuomo said, the government is here to help you. the government can't fix all of these things as any common sense person knows in a business that's supply and demand driven. >> thanks for joining us. great to have you on especially at times like this with your great knowledge base. good to see you. joe, do you have a quick trade? >> yeah. the refiners continue to work. we have a diesel problem in this country. inventories at 45-year lows. we have talked about it all year. of course the refiners will continue to do well. it goes to a broader conversation that the entire country needs to have. seems like all the problems we feared are coming forth at one time. a lot of money will have to be spend whether it's on the growth of shale, on refineries, whether it's on building out grids. the question is where is the money coming from? >> thank you very much. coming up, the euro falling to two-month lows against the dollar as greece gets ready to
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vote on the latest austerity package. more after this. [ male announcer ] this is steve. he loves risk. but whether he's climbing everest, scuba diving the great barrier reef with sharks, or jumping into the market, he goes with people he trusts, which is why he trades with a company that doesn't nickel and dime him with hidden fees. so he can worry about other things, like what the market is doing and being ready, no matter what happens, which isn't rocket science. it's just common sense, from td ameritrade. or that printing in color had to cost a fortune. nobody said an all-in-one had to be bulky.
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enviously as an out of power new jersey guy -- coming up in the next next hour of "power lunch," the northeast struggling to pick up the pieces after hurricane sandy. we got another big storm heading our way in the middle of the week. we'll have the latest on the nor'easter and a look at what kind of impact it might have. and heading into the real final homestretch, president obama, governor romney taking their last swings at the pigeons ahead of tomorrow's election. very latest poll numbers. stocks betting on romney, bonds backing obama. what the markets really want tomorrow. the halftime report will be back in just two minutes. comes with some risk,y devt but proven technologies allow natural gas producers to supply affordable, cleaner energy, while protecting our environment. across america, these technologies protect air - by monitoring air quality and reducing emissions... ...protect water - through conservation and self-contained recycling systems... ... and protect land - by reducing our footprint and respecting wildlife. america's natural gas...
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big week ahead in the currency markets as traders eye the u.s. elections. chinese leadership change, an important budget vote in greece. joining us to break it down, andy bush. the euro levels we haven't seen in two months. getting hit pretty hard. this has do with greece and the big austerity vote? >> yeah. you can start with there's about four, five things they are creating uncertainty in the security markets. merkel's comments saying the crisis is a five-year adventure basically startled everybody. then we've got these greek votes that are coming up. >> i thought merkel sound optimistic. >> she may have been. who knows? five years. who knows? but the last thing i'd throw out there is the presidential elections get about five or six
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negative scenarios that you could easily imagine, none of which are good and aren't helping either the euro or risk-on trading. >> what are your levels at this point? whatry tradeing? >> i've been coming on your show for a while. i continue to like selling euros every chance i get. i've been pointing out the 200-day moving average. we're about 50 points below it. i want to sell it. just a tight stop about 1.2880. look for 150 points on the downside. again there's all sorts of uncertainty surrounding not only greece but the election. if you walk in on wednesday morning and the u.s. election is not figured out yet, we don't have a winner, then i guarantee you, s&p's going to be down about 3%, maybe 4%. euro is going to be testing 1.2675. >> can t could get ugly.
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let's see the biggest "pops & drops" in midday trading. o pop in tesla, higher by 7%. >> revenue beat. this is a great company. i don't know if it is a great stock just yet because it is not out of the woods. they still have to do a lot fundamentally to make me comfortable but it is a really good sign, a really good report and great forward guidance. >> drop in time warner of 7%. >> this market didn't like the earnings. i've always liked this company but lately it's been kind of expensive. i'd wait for it to drop down a little more, then i'd get involved. >> there are of course far better cable companies to buy. >> transocean. >> thedeep water is where you want to be in energy. >> tesoro. >> geographically perfectly positioned out west -- love it. >> a pop for starting young. a chinese eighth-grader recently
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became the youngest golfer ever to qualify for the masters. he's 14 years old! weighs 125 pounds. i donts know why that's relevant. >> my bag weighs more than that. >> he punched his ticket to augusta by chipping and putting his way to victory at the asia pacific championship. and i love the green pants! in april he'll be driving his ball alongside some of the world's best, even though he is not old enough to drive the cart. charming. first lady of new jersey coming up on "power lunch" at 1:00 p.m. eastern time. her thoughts on disaster relief, utilities and how you can help. that's 1:00 p.m. but first, final trades when we come back. i'm a conservative investor.
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final trade. >> i electric xlv health care. >> el paso

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